IFRS Follows One Measurement Principle Known as the Historical Cost

question 242

True/False

IFRS follows one measurement principle known as the historical cost principle.

---

Definitions:

Amortized Loan

A loan with scheduled periodic payments that consist of both principal and interest, typically enabling the loan to be paid off by its maturity date.

Monthly Payments

Regular payments made once per month, often in the context of repaying a loan or paying for services.

Trade-In

A transaction where the value of a used item is applied towards the purchase of a new item.

Effective Rate

A comprehensive interest rate that represents the full cost of borrowing or the full return on investment, including compounding.